Is Kaiser Aluminum (KALU) Stock Undervalued Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company to watch right now is Kaiser Aluminum (KALU). KALU is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 19.64. This compares to its industry's average Forward P/E of 25.11. Over the last 12 months, KALU's Forward P/E has been as high as 39.55 and as low as 10.84, with a median of 17.94.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. KALU has a P/S ratio of 0.46. This compares to its industry's average P/S of 0.73.
Finally, investors should note that KALU has a P/CF ratio of 9.66. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. KALU's P/CF compares to its industry's average P/CF of 29.21. KALU's P/CF has been as high as 13.42 and as low as 6.50, with a median of 9.64, all within the past year.
These are just a handful of the figures considered in Kaiser Aluminum's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that KALU is an impressive value stock right now.
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Kaiser Aluminum Corporation (KALU) : Free Stock Analysis Report
